IPO Long-Distance Run for Decade: What's the Deeper Meaning Behind Hubei Bank Introducing 35 State-Owned Shareholders at Once

At the critical stage of IPO review status as “Accepted,” Hubei Bank has taken further capital actions. Recently, the bank disclosed a private placement report showing that 1.8 billion shares have been issued, raising a total of 7.614 billion yuan. After the change, the total shares increased to 9.412 billion, and the registered capital was also increased accordingly.

Hubei Bank (image from the internet)

With state-owned capital leading, the most notable aspect of this capital increase is the addition of 35 new state-owned legal shareholders. Besides one provincial-owned enterprise, the others are all local state-owned enterprises from 15 cities and prefectures within the province. Following this round of capital increase, Hubei Bank’s state-owned shareholding ratio is expected to rise from 81.21% to over 84%.

According to observations, behind this “epic capital boost,” the financial institution deeply rooted in the Jingchu region is experiencing multiple effects: not only addressing the regulatory red line as its core Tier 1 capital adequacy ratio approaches the limit, but also strengthening the cooperative relationship with local governments at various levels from an equity perspective. Large-scale capital injection may also add significant leverage to its listing process.

As a provincial local legal person bank, Hubei Bank has a rich history, dating back to the establishment of Hubei Provincial Bank in 1928. In early 2010, the Hubei Provincial Party Committee and provincial government decided to establish Hubei Bank through a new merger and reorganization of five city commercial banks in Yichang, Xiangyang, Jingzhou, Huangshi, and Xiaogan. Approved by the former China Banking Regulatory Commission, Hubei Bank was officially founded in February 2011, headquartered in Wuhan. Since then, the bank has completed three rounds of large-scale capital increases and share expansions in 2012, 2018, and 2021, gradually introducing key shareholders such as China Three Gorges Group, Wuhan Iron and Steel Group, Hubei Hongtai, Hubei Transportation Investment Group, and the Provincial Finance Department.

According to its official website, the bank has a well-structured ownership with mainly state capital supplemented by private and natural persons, achieving full coverage of 17 cities and 59 county-level outlets in Hubei.

Under this shareholder structure and corporate governance, Hubei Bank’s IPO has been a long-term process. The bank began preparatory work for listing in 2015. It submitted an application in October 2020, and in March 2023, it switched to a registration-based review. Currently, the A-share IPO review status is “Accepted.”

While this capital “feast” brings multiple benefits such as optimizing capital structure, enhancing risk resistance, and advancing the IPO process, Hubei Bank still has many “internal skills” that need continuous cultivation.

As the second-largest city commercial bank in Hubei Province, Hubei Bank has experienced rapid asset growth over the past decade. By the end of 2025, the bank’s total assets are approximately 621.456 billion yuan, a year-on-year increase of 18.8%, marking two consecutive years surpassing the trillion-yuan mark. In the first three quarters of 2025, Hubei Bank achieved a net profit of 2.411 billion yuan, up 15.43% year-on-year.

However, due to rapid asset expansion and other factors, the bank’s capital adequacy ratio has been under pressure in recent years. As of the end of the third quarter of 2025, the bank’s core Tier 1 capital adequacy ratio once dropped to 7.74%, approaching the regulatory red line of 7.5%. The private placement report shows that by the end of 2025, this capital increase raised the core Tier 1 capital adequacy ratio from 7.94% at the end of 2024 to 8.96%, an increase of 1.02 percentage points; the capital adequacy ratio rose to 12.62%.

In terms of asset quality, data shows that the bank’s non-performing loan balance is 6.499 billion yuan, with a non-performing loan ratio of 1.85%. Although this ratio has decreased from 1.95% at the end of 2024, it remains relatively high among peers, and the actual non-performing loan amount is increasing.

It is worth noting that Hubei Bank was the first in the province to publicly disclose its average annual salary for employees earlier this year. In 2024, the bank’s average annual salary was 186,000 yuan (excluding the salaries of provincial officials for the current year). Overall, employee compensation saw a slight increase year-on-year. The disclosure of salary transparency also signals a move toward more standardized governance.

Hankou Bank (image from the internet)

Also a local city commercial bank in Hubei, Wuhan-based Hankou Bank is another “friendly competitor” that Hubei Bank cannot ignore. According to its official website, Hankou Bank was established in 1997, with over 200 branches and more than 5,000 employees. As of the end of December 2024, the bank’s total assets reached 673.7 billion yuan. Similarly, Hankou Bank is also in a long-distance race for IPO, having completed a 4.586 billion yuan capital increase and bringing in 11 local state-owned enterprises as shareholders in 2025.

This means the competition for “which bank will be the first listed in Hubei” continues and intensifies.

Zhao Hongbing (image from the internet)

Zhao Hongbing, Chairman of Hubei Bank, is a “newcomer” to this longstanding city commercial bank. Born in 1968 in Zhongxiang, Hubei, Zhao holds a bachelor’s degree in finance from Xiamen University and a master’s degree in economics in finance from Zhongnan University of Economics and Law. From his background, Zhao Hongbing has no prior banking experience. He previously worked for a long time at the Hubei Provincial Finance Department and was appointed in early 2024 as chairman of Yangtze River Property & Casualty Insurance. As Hubei’s first nationwide legal entity property insurance company, Yangtze River Property & Casualty was established in 2011, directly managed by the Hubei Provincial Party Committee and government, with a registered capital of 2.797 billion yuan. In April 2025, Zhao Hongbing was appointed Party Secretary of Hubei Bank. In June of the same year, the Hubei Financial Supervision and Administration approved his qualification to serve as chairman.

Notably, after taking the helm of Hubei Bank last year, Zhao Hongbing set a goal of “assets exceeding one trillion yuan by 2027.” Based on the latest data, there is still a gap of several hundred billion yuan from this target.

Industry insiders believe that the key long-term issues for Zhao Hongbing and the management team include how to deepen strategic cooperation with local governments, balance scale expansion with capital consumption, improve profitability without relying solely on shareholder “blood transfusions,” and cultivate strong risk management capabilities.